Does Low CIBIL Score Affect Car Loan?

People with high CIBIL scores and good credit history have a better chance of landing a car loan. While those with a less satisfactory credit history may think they are not eligible for a car loan, they can steadily work to improve their financial behavior to reach an optimum credit score needed to get a loan to purchase vehicles.

Most of the banks accept a CIBIL score of 750 for granting a car loan. Keeping this in mind, one can hope to be capable enough to buy their dream car. Start with checking your credit report for observing your repayment journey. Check your CIBIL score and strategize a plan to figure out how you can improve your CIBIL score.

Bettering your credit score can take some time if you have any outstanding loans and EMIs to pay. Your CIBIL score can be seriously affected if irregular payments or a delay in payment towards loans and credit cards is made.

Note the errors in your credit report and try to fix them as soon as possible to increase the chances of you obtaining a car loan. Some errors in the report can lower your score drastically. An inquiry on your file is created every time the lender accesses your credit report. Thus, make sure to avoid applying at every financial institution all at once for credit.

A good CIBIL score attracts better interest rates, thus resulting in helping you paying off your loan in a shorter period of time or at a lower interest rate. Documents like the salary slips can authenticate that you have a stable job, which can work, in your favor when you approach a lender for a car loan.

In addition, other documental proofs such as your electricity and water bills tell that you make regular payments and can help you gain a chance at securing the loan on car.